Purchasing a place to call a home of their own is a dream of every individual and Filipino family. Whether it is a Bria Homes affordable house and lot inside a safeguarded community or a condominium unit in the heart of progressive cities in the country, acquiring your home of choice is a big decision that starts with planning and laying out all the options. With having a guide on your home-buying journey, you can find out what type of property investment accommodates your daily needs and suits your preference and lifestyle.
The real estate industry is full of jargon words that may confuse you if you deal with it for the first time around. If you are planning to venture into buying a house and lot as a long-term investment, it is advisable to have knowledge and understanding of various terms used to avoid complications. There are numerous real estate terms you must be familiar with, however, in this article, we will only focus on these topics — the reservation fee agreement in the Philippines, reservation fee on buying property, and what happens after paying a reservation fee for your house and lot.
How does a reservation fee agreement work?
According to Thomson Reuters Practical Law, the reservation agreement is defined as an agreement between a buyer and seller of land, which involves a written statement of intent to buy and sell a property. This is also subject to a contract whether or not a fee is paid.
In brokerage terms, the reservation fee agreement is also called earnest money. It is not the same as exclusivity agreements or the “lock-in” or lock-out agreements. Reservation agreements are commonly used in the sale of new house and lot properties, wherein a buyer reserves the right to buy the property for a period of time, known as a reservation period, and pays a fee for it. The developer of the property will not be able to sell it to another during the reservation period.
If the buyer decides to buy the property, any fee is deducted from the deposit paid during the exchange of contracts. On the other hand, if the buyer does not proceed, the reservation agreement can be canceled at any time during the reservation period and the developer typically reimburses the reservation fee after expenses are deducted, including legal and administrative fees.
A reservation fee agreement usually states the following:
- The amount of the reservation fee.
- The property being sold (for instance, indicate the plot number and garage/parking space if it is separate).
- The purchase price.
- The validity period of the price.
- The deadline for when the reservation agreement will end if the contracts are not exchanged.
- The expenses to be deducted from the reservation fee if the contracts are not exchanged.
In case the contracts are not exchanged, the developer keeps the reservation fee and the reservation agreement automatically terminates.
Based on PhilippinesProperties101, in signing a reservation fee agreement in the Philippines, here is the list of the information needed:
For the Principal Buyer
- Full Name
- Local Address and/or Address Abroad
- Birth Date
- Tax Identification Number (TIN) Number
- Contact Number
- Email Address
- Employment Status
- Marital Status
For the Wife or Husband of the Buyer
- Full Name
- Birth Date
- Tax Identification Number (TIN) Number
- Number of Children
Other general requirements include two (2) valid government identification and signatures. Meanwhile, to get an example of a reservation agreement form and other legal documents needed in your house and lot buying process, here is the Philippine Legal Forms website.
What is a reservation fee?
In the Philippines, it is easy to make a reservation and hold a property because most reservation fees from developers are affordable and attractive to many buyers. Nevertheless, buyers should not only consider the affordability of the reservation free but also make sure that they pre-qualify themselves with the income requirements and capability to fully pay for the property or unit.
The payment of a reservation fee is the first step in acquiring a house and lot. This is payable in cash, deposit, checks, and wire transfers, depending on the developer. For spot cash payments or down payments through financing, it can also be deductible from the selling price.
What happens after paying a reservation fee for your house and lot?
Once payment is made to hold a property, an official receipt will be issued as confirmation. The official receipt given for check, deposit, or wire transfer payments may take up to a week to clear and post. Paying in cash is the best option and the reservation is usually valid within 30 days.
In terms of canceling the reservation, you may do so, but the downside is that the reservation fee is not refundable. This is because the developer missed the opportunity to sell the property to other interested buyers during the reservation period if he/she wants to cancel. When you want to cancel the reservation for the property, it is recommended that you write a formal cancellation request if you have submitted confidential documents during the signing of the reservation.
How to reserve a unit at Bria Homes?
Some of the frequently asked questions at the Bria Homes website involve reservation fees on buying property. Buyers can reserve online through an online reservation system or visit any of their sales offices nationwide. You can also take a hassle-free tripping tour to experience the community 24/7 through Bria Homes virtual tours.
At Bria Homes, your home-buying journey is now a breeze amidst the global pandemic. Reserve anytime and anywhere online with the following steps:
- Go to the Bria Homes Inc. website.
- Choose a location and house model.
- Contact an available marketing officer or salesperson.
- Fill out the E-BIS Form and send the reference number to the respective marketing officer or salesperson.
- Submit a photo of two (2) valid IDs with three (3) specimen signatures of the buyer, spouse, or co-borrower. In the case of a representative, an authorization letter and one (1) valid government ID of the representative are needed.
- Marketing will conduct a briefing via Zoom or Messenger.
- Sign the documents necessary.
- Pay the reservation fee through accredited payment channels.
The reservation fees start at Php 3,000 for an Elena or Elyana inner unit, Php 5,000 for an Elena or Elyana end unit, and Php 10,000 for Bettina or Alecza unit.
In terms of financing, here are the available options you can choose from — bank financing, PAG-IBIG financing, in-house financing, deferred financing, and spot-cash financing. The loan terms for bank financing is a maximum of 20 years for locally employed individuals and 15 years for Overseas Filipino Workers (up to 65 years of maturity age. For PAG-IBIG financing, the maximum is 30 years up to 70 years of maturity age. Lastly, for in-house financing, the maximum is 10 years up to 60 years of maturity age.
Now that you are familiar with the reservation fee terms, now is the time to learn the process of purchasing the Bria Homes house and lot of your dreams. Take note that Bria Homes has over 50 housing projects scattered across 21 provinces in the country. While there is a unit for everybody, you have to list down factors to consider as you start the process of choosing your new home.
Written by Gianne D. Inumerable